DBS reports 5% profit drop and explores prime brokerage expansion
DBS Group posted a 5% decline in third-quarter net profit to S$2.81 billion, missing forecasts, and said it is weighing the launch of a prime brokerage unit as it seeks growth in Asian institutional equities.
Singapore-based DBS Group said its net profit for the quarter ended 30 September 2026 fell 5% to S$2.81 billion, below the S$2.95 billion consensus estimate. The decline was driven primarily by a 65% slump in markets trading income, which fell to S$152 million as Asian asset markets weakened and equity volatility softened.
Chief executive Tan Su Shan told investors the bank is considering establishing a prime brokerage business to broaden its institutional equities franchise. While DBS does not yet have a traditional prime brokerage operation, it already offers stock custody, market access and trading capabilities. “So I think in Asia we have all the building blocks and we may put it together. But right now we’re still considering what the options are,” Tan said.
Tan added that trading now represents about 6% of DBS’s total income but emphasized that the underlying structural growth momentum remains strong, citing expanding client numbers, volumes and fee-related revenue. She expressed optimism about the bank’s investment in artificial intelligence and its ability to navigate “choppy” markets, which she said can create opportunities to strengthen the balance sheet.
Group net interest income rose 4% to S$3.71 billion, offsetting lower Singapore Overnight Rate Average rates, while net interest margin slipped nine basis points to 1.87%. The lender declared a dividend of S$0.81 per share, up from S$0.75 a year earlier. For 2027, DBS projects total income growth in the mid-single-digit range, with net interest income expected to rise on loan and deposit growth and non-interest income potentially expanding at double-digit or high-single-digit rates depending on market conditions.
The bank also announced that chairman Peter Seah will retire after 16 years, to be succeeded by board member Anthony Lim on 1 January 2027. Shares were marginally down at S$70.59 during Thursday’s midday trading.